All entries for April 2013

April 29, 2013

SAP Netweaver and Process Integration

SAP Netweaver and Process Integration

SAP Netweaver is an application and integration platform that unifies ‘people’, ‘information’ and ‘business processes’. It has been built as the new technical foundation for all future SAP applications. This platform is based on Enterprise Service Architecture (ESA), keeping in mind SAP’s strategy of offering future products in compliance with ESA. ESA is built on the benefits of web service, which is an interface implementing the industry standards of SOAP and WSDL to expose different functionalities to a web service consumer. The use of web service allows direct integration between applications and ERP system or more specifically SAP, without involving a middleware for integration.

SAP Netweaver is not a replacement for SAP R/3, but has been explained as a marketing strategy. One important part of Netweaver is integration of processes. This is done through SAP’s own middleware called SAP PI (Process integration, previously known as SAP XI). SAP PI is used for integrating both SAP and non-SAP applications. It is used for both internal and external integration. i.e. for both application to application and business to business. It runs on SAP WAS (Web application Server), which is the common platform for all SAP applications. The integration builder, which is the middleware, comprises of two main parts-

  • ESR (Enterprise Service Repository)
  • ID ( Integration directory)

These two are used for designing and configuration of objects within the middleware respectively. The integration builder is built on two stacks- ABAP and Java. The best part about SAP PI is that all definitions use open technologies like BPEL (Business Process Execution Language), WSDL,XML and XSD. Java based graphical tools are also deployed in this middleware.

Process Integration is an important part of the framework, and critical for successful implementation of SAP. For this reason, most SAP implementation projects involve the use of SAP Netweaver and SAP PI.

April 28, 2013

The integration of ERP System and Lean Manufacturing

Lean manufacturing encourages the production efficiency through eliminating waste and ERP helps to integrate the business process and also to provide some real-time information that will support the managerial decision-making. However, in the lean manufacturing, ERP might be identified as a source of waste because it can create the excess inventory, slow production and less flexibility. Furthermore, ERP system usually requires data, which is not used to control or improve the business process and also sometimes the gap between the actual business process and the ERP system is too big. It is therefore there is on-going debate whether ERP system can support Lean manufacturing or not.

The major conflicts lies within production scheduling and material planning. ERP system depends on the forecast demand for planning the material whilst lean manufacturing encourages ‘pull’ system in which the production scheduling is driven by the customer demand. Consequently the inventory will be kept as minimum as possible possibly through kanban card and any other lean manufacturing tools.

Despite this argument, lean concept requires high data quality and accuracy in which ERP system does support. The quality of data helps the company in solving the problem and sustaining the continuous improvement if data is managed properly. Furthermore, The ERP system that doesn’t involve directly with the production/outside the factory plant does support the Lean manufacturing very good, for example ERP can help the decision whether to accept or reject the order by calculating the capacity in which the ordering can be processed faster. Consequently it helps the company to reduce the lead-time in overall and this is aligned with the one of lean manufacturing concept, which is to shorten the lead-time.

However, the biggest impact in determining the lead-time lies in the production line. Setup and cycle time can bring impact to the lead-time and these are tracked in the ERP system so that the wasted time in those processes can be eliminated gradually. In addition to that, The Business Intelligence, which is part of the ERP, helps the company to monitor their performance.

It is therefore important for the company that adopt lean practices to select which ERP systems that suitable for their business process especially if it involves the production line and subsequently adjust that ERP system in accordance with their need so that the gaps between the actual business process and ERP system model can be reduced. Nowadays, there are some ERP software firms that make their product support lean manufacturing. One example of those is Microsoft Dynamics AX 2012.


Daryl Powell, Jan Riezebos & Jan Ola Strandhagen (2013): Lean production and ERP systems in smalland medium-sized enterprises: ERP support for pull production, International Journal of Production Research, 51:2, 395-409

Lean manufacturing and ERP: How to leverage ERP to get lean. Available online at<> [Accessed on 1 April 2013]

Can Lean and ERP Work Together. Available online at <> [Accessed on 1 April 2013]

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