An ERP solution is an integrated information system that serves all departments within an enterprise. ERP systems evolved out of the manufacturing industry, but are now widely used across many other kinds of businesses.
ERP implies the use of modules of packaged software rather than proprietary software written by or for one customer, and typically an ERP system is integrated with a relational database system.
ERP modules may be able to interface with an organization’s own software with varying degrees of effort, and, depending on the software, ERP modules may be alterable via the vendor’s proprietary tools as well as proprietary or standard programming languages.
An ERP system can include software for manufacturing, order entry, accounts receivable and payable, general ledger, purchasing, warehousing, transport and human resources.
All of the major ERP solutions may be accessed via web browsers and the internet has also allowed ERP systems to extend out of the financials applications of organizations and along the supply chain, to interact with suppliers for demand planning for example, or to improve customer service by allowing customers to track the progress of orders.
Implementing an ERP system can involve considerable business process analysis, employee retraining, and new work procedures, but the benefits can be very significant.
ERP packages with their native connectivity between modules are becoming an increasingly attractive way of harmonizing the information flow across an organization.
Developments such as EDI or message broking software and standards such as XML are allowing large companies with ERP systems to integrate information handling throughout their departments. At the same time flexibility in pricing and hosting options are also allowing smaller organizations to be able to afford ERP solutions.