ERP Systems

Enterprise Resource Planning Systems

Enterprise resource planning systems, also called ERP software systems or ERP business solutions, are server architectures, software product suites, and computer networks that unify the diverse software functions of a business onto a single standardized platform. Before installing enterprise resource planning systems, many companies make use of software programs to facilitate tasks related to accounting, payroll and human resources, but these tasks are often carried out on software used only by specific departments. The accounting department uses programs and stores databases on its own platform, the human resource department uses a separate software platform, and so on throughout a given company. This kind of isolation can prevent departments from sharing beneficial data without complicated conversions and a high potential for error. Running isolated software systems like this can also limit a company’s ability to upgrade its software programs when better ones become available, and it can also mean that an employee trained in one department has to relearn a set of software functionalities after moving to another department.

Enterprise resource planning systems were first developed in the early 1990s for use in the manufacturing industry. Problems caused by isolated systems were felt most strongly in a business sector with a high dependence on scheduling and coordinating timed functions. For a manufacturing shop floor to run smoothly, parts and raw materials must be ordered and delivered on a schedule that integrates perfectly with the availability of labor and other manufacturing resources. Ideally, in a manufacturing environment, departments that manage human resources, billing, shipping, order processing, and even sales, marketing and product development can all share schedules and access to collective databases. In this environment, sales can gather customer feedback regarding the success of a product, marketing can chose a new direction for the product, product development can change it, and the shop floor can order the necessary materials and make the necessary alterations in the fastest possible way with the least amount of inefficiency and error. With enterprise resource planning systems in place, this kind of data sharing becomes possible. So does the ability to update the data in real time and coordinate responses to changing conditions. This can improve and streamline all aspects of a business, from customer relationship management to asset management.

Enterprise resource planning systems were developed for use in the manufacturing sector, but over the last few decades their popularity has soared and system implementations have taken place in a wide variety of other business sectors as well. At this point, many government offices and universities have installed enterprise resource planning systems and have seen considerable improvements in the efficiency of their operations. Market demand for enterprise resource planning systems is now increasing fastest in the small business sector.

Written by :

tracey boxer