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What is ERP Software?


ERP is an acronym for Enterprise Resource Planning. It is business-process management software that helps in the automation and integration of company’s core business to help them focus on effectiveness and simplified success.

It employs integrated applications and to manage the business and automate many back-office functions related to technology, services and human resources. An ERP software integrates all the aspects of a business including a product’s planning, development, manufacturing, sales and marketing.

ERP software is considered an Enterprise Application since it is designed for the larger businesses where often dedicated teams are required to customize and analyze the data and to handle upgrades and deployment. Alternatingly, Small Business ERP applications are lightweight business management software solutions that are customized for the business industry that one works in.

An ERP software has the potential to improve the overall effectiveness of an organization by:

  • Defining the business process and ensuring its compliancy throughout the supply chain
  • Planning work load based on the existing orders and forecast
  • Providing tools to ensure high level service to the customers
  • Processing data into decision making information
  • Providing security to critical business data through well-defined roles

ERP Software Modules

A typical ERP software consists of multiple ERP software modules that are individually purchased depending upon the requirements and technical capabilities of a business. Separate modules focus on separate areas of the business processes like product development or its marketing. A business can use ERP software to manage back-office activities and tasks like distribution process management, supply chain management, improve accuracy of financial data, standardize critical business procedures, assess business needs, accounting and financial applications and much more.

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Some common ERP modules include those for product planning, material purchasing, inventory control, distribution, accounting, marketing, finance and HR.

ERP Software Benefits

  • Integration of the ERP across all business processes from the customer facing front-end planning and scheduling to production and distribution of the company’s products is needed for the full realization of the software.
  • Increases overall performance of the organization by integrating disparate business processes that ensure coherence and avoiding duplication, discontinuity and employees working at cross purpose in different parts of the organization.
  • Automation enhances productivity since the automation of ERP software makes business processes more efficient, error-free and faster.
  • Integration across whole supply chain to integrate with both supplier and customer system to ensure full visibility and efficiency.
  • Get quality reports and performance analysis to analyze the working of various channels and enhance the efficiency of the organization.

Top ERP Trends

  • Mobile ERP. Since with this one can get real-time access to information, it is used and will become more popular for retrieving reports, dashboards and to conduct key business processes.
  • Cloud ERP. Owing to its high usability it is steadily becoming popular.
  • Social ERP. Social media is the current rage among businesses; hence, ERP software also has integrated this feature.
  • Two-tier ERP. An omnipotent ERP, since faced heavy failures, this is the best practice now.

ERP Vendors

Depending on the size of one’s organization and its requirements, one can choose from the following ERP vendors.

  • Large Enterprise ERP (ERP Tier I): SAP, Oracle and Microsoft Corporation
  • Mid-Market ERP (ERP Tier II): Infor, QAD, Lawson, Epicor, Sage and IFS
  • Small-Market ERP (ERP Tier III): Exact Globe, Syspro, Netsuite, Visibility, Consona, CDC Software and Activant Solutions