What Are the Characteristics of ERP Systems?

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What Are the Characteristics of ERP Systems?

ERP stands for enterprise resource planning and is a business process designed to organize, integrate and control the entire supply chain of a company. ERP system helps in decision making and provides resources for decision support. ERP system has four stages namely planning, implementing, controlling and monitoring. ERP enables the collection, processing, maintenance and retrieval of information and enables cooperation between different departments at a single location. Enterprise resource planning is integrated management of various business processes, usually in real-time and mediated through technologies and software.

ERP System

ERP system helps in the automation of business procedures and processes and supports back-office functioning. Enterprise resource planning software systems are designed and developed keeping in mind the complete business requirements of the organization. ERP packages are customized to fit the needs and requirements of a specific organization. The term ERP can be applied to both the software and the hardware.

An ERP system is implemented when an organization needs to migrate from existing manual procedures to an ERP system that helps in the automation of business processes. ERP software typically provides the following benefits – elimination of multiple procedures, tracking of activities, easier administration and control, reduction in cost of ownership and avoidance of data duplication. Implementing an ERP software involves implementation of ERP modules where ERP application and its supporting infrastructure are installed. The components of an ERP system are implemented in such a way that they are integrated with each other. It also involves the integration of certain business processes and customizations to enhance efficiency and productivity of the organization. Implementing an ERP system is a very complicated task that requires a lot of analysis and planning.

Many companies want to take the advantage of ERP systems but some think that it is necessary for their companies to keep all the processes in house. ERP software applications may include some complicated features like reporting and analyzing data, which can only be executed within the company. Enterprise resource planning software is considered as one of the most beneficial solutions for companies having varied business segments. Enterprise resource planning software, however, cannot provide a complete solution for all business requirements. There are certain limitations of ERP systems like inability to handle complex changes, multi-tenancy of projects, lack of flexibility, lack of standardization in reporting and lack of support for international languages.

Manufacturing resource planning (MRC) is another popular ERP system used in manufacturing industry. MRC involves the whole life cycle of production including planning, manufacturing, transportation, marketing, and sales. ERP software applications for MRC are designed according to the specific needs of a manufacturing company. Enterprise resource planning software is beneficial for companies involved in the manufacturing sector, which are involved in the following processes procurement, production planning, financing, marketing, and customer service and back-up services.

The market demand for ERP software applications has significantly increased due to the advent of MRCs in the manufacturing sector. ERP provides tools to manage the interactions between various parts of the supply chain. The supply chain helps in delivering products to the customers at the right time. It also helps in reducing costs and improving the productivity of an organization. Supply chain processes integrate different elements of the supply chain namely supplier based processes, inventory-based processes, order processing and customer servicing and back-up services. ERP software applications help in integrating these processes and improving the overall productivity of the organization.

CRM Software System is another popular ERP system that helps in managing the customer database. CRM enables organizations to effectively manage and sustain the relationships with their customers. It offers two prominent benefits it helps in decision making and tracking and enables easy sharing of information between the enterprise and its various business units through the various communication channels like e-mails, faxes, and phone calls.

Enterprise Resource Planning (ERP) System, also known as Enterprise Resource Planning (ERP) software system offers two erp options ERP: Strategic Business Management and ERP: Single Productivity Management. ERP: Strategic Business Management integrates different business sections within the organization such as accounting, finance, marketing, human resources and production. ERP: Single Productivity Management focuses on improving the efficiency of a single business unit by streamlining and integrating the activities of that unit under a common framework. Both these packages are popular among midsize and large organizations and can be purchased for effective cost management.

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