Enterprise resource planning is also known as ERP, and it’s related to systems which combine internal and external management of data via a whole organization. For example, systems which may be integrated in order to improve processes include finance/accounting, manufacturing, sales/service and customer relationship management (commonly referred to as CRM).
Enterprise resource planning makes it simpler to control data flow through all aspects of a business’ organization, while also managing connections to outside shareholders. Those who seek out enterprise resource planning are typically looking for ways to control every aspect of an organization.
By linking all departments together, it will be possible to generate reports that offer current and accurate information. When it comes to putting business vision into practice, these sorts of software packages have very high value. In addition, they greatly assist with tracking inventory and managing staff.
CEOs who want superior control over their organizations recognize the quality of the best ERP software programs and seek them out in order to improve efficiency and record-keeping at their companies. However, the most impressive programs of this nature are generally extremely expensive.
Enterprise resource planning software has become a huge industry. Businesspeople spend multi-billions annually on these types of software packages. This sort of software features components which support an assortment of business processes.
IT investments of this nature are now classified as the biggest capital expenditures in United States-based companies. This trend started ten years ago. Enterprise resource planning software systems are very complex, and they offer the potential of combining data and processes through most or all functions within an enterprise.
History of Enterprise Resource Planning
During the early 1990s, the Gardner Group created the acronym, ERP. This acronym was used as an extension of material requirements planning, or MRP. As a newer, more modern form of MRP, ERP reflected the development of application integration that went beyond manufacturing. Early software packages that were used for ERP purposes weren’t necessarily centered on manufacturing.
Some of them featured accounting, maintenance and HR (human resources) modules. During the mid-90s, these systems tended to address most or all core processes of a company. At this stage, usage of these software designs began to evolve. For example, governments began to utilize these systems, along with for-profit and non-profit companies.
ERP rollouts (start-ups) are known to be relatively complex procedures. Typically, it’s expensive getting started with these systems. Most companies require an 18-month head start before proceeding with ERP initiatives. Most grand software packages, such as SAP and Oracle, will come with plenty of technical support and advice, via online help functions and included instructions.
However, since these new software packages require extensive integration across departments, such as manufacturing and accounting, much pre-planning will be required before rollouts. Technical savvy is recommended. Usually, IT departments will work alongside upper management in order to fulfill start-up requirements, without negatively impacting day-to-day business processes.
While SAP and Oracle are the most famous examples of huge and complex ERP software packages, services are evolving in order to help different types of businesses. For example, on-demand and software-as-a-service resources are becoming more prevalent, and these new services may offer quicker rollouts which cost less money.
Mid-market and blue-chip corporations alike may benefit from services which are “in the cloud”, or otherwise available in a pay-as-you-go format. Those who prefer to select traditional software solutions, such as SAP and Oracle, should be aware of prospective software updates for these services, and then choose to buy them once these new updates are available. This will maximize functionality for the money that will be spent.