Enterprise resource planning (ERP) plays a key role in the growth of a company. It refers to the method used by companies to better manage and integrate important parts of their businesses. This is done by the aid of an ERP software application which is very essential to companies, owing to the help they offer in helping them implement resource planning by integrating all of the processes required to run their companies with a single system.
An enterprise resource planning system can also come in handy in integrating planning, purchasing inventory, sales, marketing, finance, human resources, etc.
Understanding Enterprise Resource Planning System
Enterprise resource planning is the force that binds together the various computer systems for a large organization. It goes to say that without it, each department would be running its own optimized system for specific tasks.
But with ERP software, each department although still having its system, can access all of the systems via one application with one interface.
With ERP software applications, different departments can communicate and easily share information with the rest of the company. The software gathers information about the activity and state of various divisions and makes this information available to other parts, where it can be productively put to use.
Corporations can take advantage of the ERP software application to become more self-aware by linking information about the production, finance, distribution, as well as human resources together. This is because the software connects different technologies used by each part of a business, thus an ERP application can eliminate costly duplicate and incompatible technology.
This process often integrates accounts payable, stock control systems, order-monitoring systems, as well as customer databases into one system.
With an ERP software application, corporations can integrate, or connect, many different modules that make up the system. This puts at the center of the system a giant shared database that all departments in the company can access and benefit from. With this database, you can have information about: customers, suppliers, products, orders, shipments, and payments.
Importance of ERP System
Here are a few reasons why deploying ERP system might be necessary:
- Inaccurate data
- No measurable and clearly identifiable data
- Complex nature of the company
- Inadequacy of the installed business systems.
The importance of an ERP system cannot be overemphasized as it can help in solving multi-platform IT issues and improve performance with the availability of information with a real-time mode and faster response time. Also, an ERP system can help increase the interaction between internal employees and that of external organizations, as well as streamline workflow.
ERP systems are customized by consultants with the client’s unique requirements and comes highly recommended for both big and small businesses. It also enables small companies to appear, act, and operate as a large-scale enterprise.
ERP Solution Providers
Some leaders in the ERP software world are:
- ORCL (Oracle Corp.). This ERP provider originally supplied a relational database integrated with ERP software developed by SAP before entering the broader enterprise market on a larger scale in the early 2000s.
- Microsoft (MSFT) has also dominated the industry for quite a while and has many customers who use multiple software applications from the company.