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Understanding ERP: Evolution and Benefits

ERP (Enterprise Resource Planning) is a widely implemented business software system that integrates various organizational functions to improve resource planning and management. It has evolved from basic inventory management in the 1960s to a comprehensive solution used by organizations of all sizes across different industries. The growth of the ERP market is driven by its ability to enhance business performance, support growth, provide real-time decision support, and eliminate limitations of legacy systems.

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14 views11 pages

Understanding ERP: Evolution and Benefits

ERP (Enterprise Resource Planning) is a widely implemented business software system that integrates various organizational functions to improve resource planning and management. It has evolved from basic inventory management in the 1960s to a comprehensive solution used by organizations of all sizes across different industries. The growth of the ERP market is driven by its ability to enhance business performance, support growth, provide real-time decision support, and eliminate limitations of legacy systems.

Uploaded by

islamtonoy83
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PPTX, PDF, TXT or read online on Scribd

ERP

(Enterprise Resource
Planning)
The Picture
 One of the most influential IT and organizational systems development
in last forty years has been through ERP development.

 Thousands of organizations have been using ERP to change their


business models

 Millions of employees in these organizations in their daily works

 Tens of thousands software developers earn their living with writing


ERP software

 ERP Vendors and their implementation partners earn billions of dollars


in ERP market
Evolutions of ERP

1960’s – Inventory Management and


Control
1970’s - MRP (Materials Requirement
Planning
1980’s - MRP II (Materials Requirement
Planning II
1990’s - ERP (Enterprise Resources
Planning
Meaning
 ERP is one of the most widely implemented
business software systems in a wide variety of
industries and organizations.

 ERP is the acronym of Enterprise Resource


Planning.

 It utilizes ERP software applications to


improve the performance of organizations’
resource planning, management control and
operational control.
Meaning…

 ERP software is multi-module application software


that integrates activities across functional
departments, from product planning, parts
purchasing, inventory control and product
distribution, to order tracking.

 ERP software may include application modules for


the finance, accounting and human resources aspects
of a business.

 ERP is just not only a software but also a business


integration process.
Concept
 The term ERP originally referred to how a large
organization planned to use organizational wide
resources.

 In the past, ERP systems were used in larger more


industrial types of companies. However, the use of
ERP has changed and is extremely comprehensive,
today the term can refer to any type of company, no
matter what industry it falls in. In fact, ERP
systems are used in almost any type of organization
large or small.
Concept…

• In order for a software system to be considered ERP, it


must provide an organization with functionality for two
or more systems. While some ERP packages exist that
only cover two functions for an organization (Payroll
and Accounting) most ERP systems cover several
functions.

• An ERP system is based on a common database and a


modular software design. The common database can
allow every department of a business to store and
retrieve information in real-time. The information
should be reliable, accessible, and easily shared.
Basic Characteristics of ERP

ERP is an enterprise-wide system with two


basic characteristics:

 Data Integration

 Best Practice of Business Process


Reasons for the Growth of the ERP Market

Why are so many companies replacing their business


systems with ERP (systems)?

Here are some reasons:


1. Enables improved business performance
 cycle time reduction…
 increased business agility…
 inventory reduction…
 order fulfilment improvement
Reasons for the Growth…

2. Supports business growth requirements

 new products/product lines, new


customers…

 global requirements including multiple


languages and currencies…
Reasons for the Growth…

3. Provides flexible, integrated, real-time decision


support

4. Improve responsiveness across the


organization…

5. Eliminates limitation in legacy systems


 fragmentation of data and processing…
 inflexibility to change…
 insupportable technologies…

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