2. Q1) What is ERP?
Enterprise resource planning (ERP) is business process management software that allows an
organization to use a system of integrated applications to manage the business and automate
many back office functions related to technology, services and human resources. ERP software
integrates all facets of an operation, including product planning, development, manufacturing,
sales and marketing when you search for "ERP" on the web, the sheer amount of information
that comes up can be overwhelming—not to mention a little confusing. Every website seems to
have its own definition of ERP, and one ERP implementation can vary widely from the next.
These differences, however, underscore the flexibility that can make ERP such a powerful
To get a deeper understanding of how ERP solutions can transform your business, it helps to
get a better sense of what ERP actually is and how it works. Here's a brief introduction to ERP
and why it seems like everyone's talking about it.
ERP is an acronym for Enterprise Resource Planning, but even its full name doesn't shed much
light on what ERP is or what it does. For that, you need to take a step back and think about all
of the various processes that are essential to running a business, including inventory and order
management, accounting, human resources, customer relationship management (CRM), and
beyond. At its most basic level, ERP software integrates these various functions into one
complete system to streamline processes and information across the entire organization.
The central feature of all ERP systems is a shared database that supports multiple functions
used by different business units. In practice, this means that employees in different divisions—
for example, accounting and sales—can rely on the same information for their specific needs.
ERP software also offers some degree of synchronized reporting and automation. Instead of
forcing employees to maintain separate databases and spreadsheets that have to be manually
merged to generate reports, some ERP solutions allow staff to pull reports from one system.
3. For instance, with sales orders automatically flowing into the financial system without any
manual re-keying, the order management department can process orders more quickly and
accurately, and the finance department can close the books faster. Other common ERP features
include a portal or dashboard to enable employees to quickly understand the business'
performance on key metrics.
A Brief History of ERP
The term ERP was coined in 1990 by Gartner1, but its roots date to the 1960s. Back then, the
concept applied to inventory management and control in the manufacturing sector. Software
engineers created programs to monitor inventory, reconcile balances, and report on status. By
the 1970s, this had evolved into Material Requirements Planning (MRP) systems for scheduling
In the 1980s, MRP grew to encompass more manufacturing processes, prompting many to call
it MRP-II or Manufacturing Resource Planning. By 1990, these systems had expanded beyond
inventory control and other operational processes to other back-office functions like accounting
and human resources, setting the stage for ERP as we've come to know it.
Today, ERP has expanded to encompass business intelligence (BI) while also handling "front-
office" functions such as sales force automation (SFA), marketing automation and ecommerce.
With these product advancements and the success stories coming out of these systems,
companies in a broad range of industries—from wholesale distribution to ecommerce—use ERP
Moreover, even though the "e" in ERP stands for "enterprise," high-growth and mid-size
companies are now rapidly adopting ERP systems. Software-as-a-Service (SaaS) solutions—also
referred to as "cloud computing"—have helped fuel this growth. Cloud-based solutions not only
make ERP software more affordable, they also make these systems easier to implement and
manage. Perhaps even more importantly, cloud ERP enables real-time reporting and BI, making
them even valuable to executives and staff seeking visibility into the business.
4. As a result, companies of all sizes and a wide range of industries are transitioning to cloud ERP
systems. In fact, Forrester predicts that SaaS-based ERP adoption will rise 21 percent annually
through 2015.2 When you stop to consider the benefits of ERP, it's easy to see why it's become
so popular and why its use will continue to grow so rapidly. ERP software (or enterprise
resource planning software) is an integrated system used by organizations to combine, organize
and maintain the data necessary for operations. ERP systems merge an organization’s key
operations, including the manufacturing, distribution, financial, human resources and customer
relations departments, into one software system. Selecting an ERP software package and
implementing it correctly can be an extremely complex and intimidating process for many
executives and project teams. When the ERP evaluation and implementation is performed
correctly, ERP software can revitalize an organization by streamlining and synchronizing its
separate departments into one unified software system. When these tasks are done without
focus and solid planning, the ERP software project can have severe repercussions that
negatively affect the organization for many years to come.
An important goal of ERP is to facilitate the flow of information so business decisions can be
data-driven. ERP software suites are built to collect and organize data from various levels of an
organization to provide management with insight into key performance indicators (KPIs) in real
ERP software modules can help an organization's administrators monitor and manage supply
chain, procurement, inventory, finance, product lifecycle, projects, human resources and other
mission-critical components of a business through a series of interconnected executive
dashboards. In order for an ERP software deployment to be useful, however, it needs to be
integrated with other software systems the organization uses. For this reason, deployment of a
new ERP system in-house can involve considerable business process reengineering, employee
retraining and back-end information technology (IT) support for database integration, data
analytics and ad hoc reporting.
5. Legacy ERP systems tend to be architected as large, complex homogeneous systems which do
not lend themselves easily to a software-as-a-service (SaaS ERP) delivery model. As more
companies begin to store data in the cloud, however, ERP vendors are responding with cloud-
based services to perform some functions of ERP -- particularly those relied upon by mobile
users. An ERP implementation that uses both on-premises ERP software and cloud ERP services
is called two-tiered ERP.
ERP software, in turn, is designed to improve both external customer relationships and internal
collaborations by automating tasks and activities that streamline work processes, shorten
business process cycles, and increase user productivity. A method for standardized processing,
an ERP software application can both store and recall information when it is required in a real-
Companies often seek out ERP software systems to pinpoint and mend inefficiencies in a
business process or when a number of complex issues exist in the business environment. ERP
software systems are also implemented to enhance operational efficiencies, achieve financial
goals, manage and streamline the company’s operational processes, replace an existing ERP
software system that is out of date or unable to handle a company’s daily activities; or improve
information management through better data accessibility, decreased data duplication and
optimal forecasting features.
Many business owners see ERP software systems to be critical to their business functions, as
they allow companies to achieve absolute business process automation. While most companies
use countless processes, activities and systems to run operations, workflows and procedures
can go awry when it comes to today’s highly competitive marketplace, thus hindering
productivity, growth and profitability. As a result, the implementation of an ERP software
application can result in increased productivity, reduced operating expenses, improved data
flow, and optimal performance management.
6. ERP software comes in many forms, including supply chain management, manufacturing,
distribution, warehouse management, retail management, and point-of-sale software.
ERP software is considered an enterprise application as it is designed to be used by larger
businesses and often requires dedicated teams to customize and analyze the data and to
handle upgrades and deployment. In contrast, Small business ERP applications are lightweight
business management software solutions, customized for the business industry you work in.
ERP has come a long way from its origins a half-century ago as a production planning tool for
Today, ERP applications run nearly every part of all kinds of businesses large and small, from
social media startups to banks and construction companies. They have jumped platforms along
with other kinds of inherently multiuser, networked software, first from mainframes to
minicomputers, then from client/server architectures to today's more distributed, Internet-
based scheme with Smartphone’s and tablets at its farthest edges.
But it's also fair to say ERP has probably made as many enemies as friends with its maddening
inflexibility, often stodgy user interfaces and extortionary license fees. Still, few companies of
any size -- or at least with dreams of becoming players -- would dare to run their business
without an ERP system -- or something very much like one.
The friendlier feel and broader, more up-to-date functions of the current crop of ERP
applications exist alongside longstanding questions about what a monolithic system can really
be expected to do. Customization is often still a necessity, and integration is a usually tedious
and expensive proposition that, ironically, becomes unavoidable when a supposedly do-it-all
system can no longer do the most basic things without outside help.
7. Q2) What are the Modules/Functions of ERP?
ERP SOFTWARE MODULES:
ERP systems are made up of many different software modules. Each of the modules in ERP
module is specialized to handle specific business processes. In this guide to ERP modules and
software, you'll find introductions to the various components of ERP and learn how each
module can benefit your organization.
Browse all of the sections of this guide, or jump directly to the section that interests you most:
ERP supply chain management
ERP customer relationship management
ERP product lifecycle management
ERP human capital management
ERP warehouse management
ERP asset management
ERP financial management
ERP order management
ERP project management
ERP inventory management
Supply chain management (SCM) is one of the most important software modules for
manufacturers. SCM gives provides visibility into the entire supply chain, from start to finish.
ERP SCM modules typically include components for forecasting, demand management,
procurement and planning; delivery modules such as logistics; and components for after-
market issues like returns, installations and contracts.
8. Manufacturers can use customer relationship management (CRM) software to organize and
view data on individual customer transactions in one accessible place. ERP CRM modules
provide customer data integration, or master data management (MDM), which keeps track of
customers across all the sales channels from in-person (field sales) to phone (including
telemarketing) to online (teleservice and support).
With product lifecycle management (PLM) software, manufacturers can track the design and
attributes of a product throughout its lifecycle, from concept to end-of-life. The components
that make up ERP PLM modules include product data management (PDM), product design,
portfolio management, direct materials sourcing and customer needs management.
Human capital management is another one of the common ERP modules. ERP HCM modules
function as the core employee record, which details personnel actions, benefits administration
and payroll, position management and compliance with government regulations. ERP HCM
covers three areas of employee management: transactional, talent management and extended
Warehouse management systems (WMS) software is a must-have for manufacturers. ERP WMS
modules follow the distribution process involved with finished goods or materials from delivery
into the warehouse for storage through replenishment and picking for shipment to fulfill
orders. WMS modules also help synchronize and control stock on the shop floor.
Manufacturers can track physical manufacturing assets involved in production -- the plant itself
and equipment -- using ERP asset management modules. Some of the daily functions that ERP
asset management handles are maintenance schedules, equipment uptime and downtime,
inventory and warranty management and compliance with hazardous materials and waste
9. Financial management is a critical business function for manufacturers. ERP financial
management modules include functionality for general ledger, which is the core of ERP financial
management. These modules also handle functions for accounts payable and receivable, fixed
assets, financial reporting and treasury management.
Order management systems take in data from orders on the front end -- such as customer
number and product part number -- and make sure that orders get filled on the back end.
Manufacturers use ERP order management modules to fill product orders at the lowest possible
cost. These modules are equipped to handle functions such as automated order entry, viewing
and tracking; order status; canceled transactions; order and credit limit validation and checking
for duplicate orders.
With project management software, manufacturers can organize and review the data around
project timelines and costs. These software systems are geared toward organizations that bill
clients based on the time their employees spend working on individual projects. ERP project
management modules handles project definition, project costing and accounting, project
portfolio management, resource management and project billing.
ERP inventory management modules move finished goods through the production cycle. They
are often tied into other functions, including shipping, logistics, orders, and billing and, on a
broader scale, warehouse management. ERP order management software includes functionality
for inventory control, serial number tracking, bar code printing, build materials and kitting,
inventory valuation and SKU management.
ERP software typically consists of multiple enterprise software modules that are individually
purchased, based on what best meets the specific needs and technical capabilities of the
organization. Each ERP module is focused on one area of business processes, such as product
development or marketing. A business can use ERP software to manage back-office activities
and tasks including the following:
10. Distribution process management, supply chain management, services knowledge base,
configure, prices, improve accuracy of financial data, facilitate better project planning,
automate employee life-cycle, standardize critical business procedures, reduce redundant
tasks, assess business needs, accounting and financial applications, lower purchasing costs,
manage human resources and payroll. Some of the most common ERP modules include those
for product planning, material purchasing, inventory control, distribution, accounting,
marketing, finance and HR.
As the ERP methodology has become more popular, software applications have emerged to
help business managers implement ERP in to other business activities and may incorporate
modules for CRM and business intelligence, presenting it as a single unified package.
The basic goal of using an enterprise resource planning system is to provide one central
repository for all information that is shared by all the various ERP facets to improve the flow of
data across the organization.
Q3) What are the current technologies of ERP and define anyone of them?
DEEPER ERP INTEGRATION.
“ERP is becoming more versatile, providing deeper integration with procurement, human
resources and customer service software,” says Michael Golz, senior vice president & CIO, SAP
Americas. “SAP has made a number of strategic acquisitions, most recently with Concur, that
help customers expand the value of their ERP system,” by having it to “interact with new
areas.” That increased integration and depth will continue to blur the lines between enterprise
software systems and help organizations derive greater value from their IT investments.
11. Mobile ERP:
Mobile ERP is an Enterprise Resource Planning System build from the ground up for the mobile
user. The main way of using the system is through a mobile device such as a Smartphone or
tablet instead of location fixed computer. Just as the ERP the Mobile ERP is a suite of integrated
applications—that a company can use to store and manage data from every stage of business.
One of the advantages of a Mobile ERP system is that it enhances mobility in a company and
thereby increases efficiency and decreases other costs such as transportation.
Other then Mobile ERP other current technologies prevailing in Markets are as follows.
1) CRM is at the top
2) Needs based ERP purchases
3) Increasing focuses on business intelligence ERP
4) Increased need for specialized ERP services
5). Better Integration architecture
6) Big companies acquiring smaller startups
7) Rising importance of ERP on Cloud
8) More focus on profit from ERP
9) Mobile ERP
10) Emergence of tiered ERP systems