What is an ERP system and how does it work?

An ERP system bundles everything you need to run a company, including CRM, inventory and marketing, into one package - and they are becoming cheaper. But what is the best ERP system for your business?

ERP stands for Enterprise Resource Planning and companies have relied on it since the ‘90s to streamline processes and improve data visibility around finance, project management and manufacturing. Simply put, ERP integrates people, processes and technologies across a business.

How ERP has evolved

ERP had its origins in the 1960s. The term was first used in the automotive industry for stock storage and regulation. Software engineers developed systems to monitor inventory and provide status updates. This had developed into systems for scheduling output cycles by the 1970s. By 1990, these programs had evolved to provide back-office roles such as accounting and human services, in addition to inventory management and production processes.

How ERP works in the cloud

ERP that is distributed as a cloud-based software-as-a-service (SaaS) model operates on a network of remote servers rather than on a company's own servers. Rather than trying to start again with an onsite setup, the cloud service patches, maintains, and upgrades the applications multiple times a year. Furthermore, a business is still using the most new ERP program.

What areas does an ERP system cover?

Every company used to have some kind of accounting, finance, or HR structure in place, but they mostly operated in silos and didn't communicate or collaborate with one another. What makes a modern ERP system better is that it integrates all of these systems into a single, fluid system.

Purchase

• Human Resources
• Customer Relationship Management
• Inventory and order management
• Stock
• e-commerce
• accounting
• sales
• Project management

What are the benefits of an ERP system?

• Significant cost savings
• Improve business insight
• Enhanced collaboration
• Increased efficiency
• Consistent look and feel
• Better cybersecurity
• Ensure procurement compliance
• Improved e-commerce functionality
• Accelerated reporting

What are the disadvantages of an ERP system?

Your cloud ERP provider’s monthly subscription can add up to the point where the total cost of these fees rivals that of the upfront cost of upgrading and maintaining your own onsite system.

How does an ERP system work?

The key principle behind ERP is that everybody is working from the same data, instead of silos of standalone databases with disconnected spreadsheets. With a secure and centralised data depository, everybody within an organisation can be confident data is correct, up-to-date and the latest version.

How long does it take to implement an ERP system?

Typically, for a large enterprise, installing an ERP system takes about 14 months and employs about 150 consultants.

What is the future of ERP?

Because the SaaS model keeps software up-to-date, new technologies such as AI and blockchain are continually updated as the ERP softwre evolves. Evolving and increasingly sophisticated predictive analytics will also help you with decision making.

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If you believe fixed fee packages are not suitable for you, Kindly click on the get an instant quote button and generate an instant quotation according to your requirements under 60 seconds. Typically, for a large enterprise, installing an ERP system takes about 14 months and employs about 150 consultants.