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Enterprise resource planning

Updated on December 13, 2014
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Enterprise resource planning, more commonly referred to as ERP is an integrated software module system used with an aim of efficient management of a business organization. Basically, any Business, weather small scale, medium scale or large scale consists of the following areas of importance: Information technology, Financial management, distribution of goods/services, employee appraisal and payroll management, raw material purchasing, Human resource management, marketing and sales, quality of services and consumer feedback along with certain other back end functions that a company or organization considers importance, as per it’s individual needs.

An ERP system helps to integrate all these parts or areas of work to bring about a smooth functioning of business processes like: marketing, planning, development, operations and manufacturing etc . ERP systems can very much be customized as per the requirement of individual business at each level.

ERP modules are usually installed at various levels. At each level, the ERP Software module system can be customized to meet the technical requirements at each level. This allows the data at various levels to be collected, analyzed, represented & organized properly. This presentation of data then allows the Businessmen to evaluate the chief performance indicators.

ERP systems are made in order to allow a smooth flow of information between the various units or levels of a business. This allows the business organizations to follow a more data driven decision making. This means that the business decisions are based on data that can be verified. Such an approach often allows a business organization to gain a competitive advantage, over it’s contemporaries. This has been verified by means of conducting various studies and surveys at small scale as well as large scale business level. However, the outcomes of these data driven decisions depend upon the authenticity, quality and correct analysis of the available data.

In large scale business, a team of individuals study, correlate and analyze data to bring about positive growth in business and make all the business processes more organized and profit bearing.

Now a days, ERP system vendors are also coming up with Cloud based, mobile based systems in addition to the in office systems. ERP systems are also sold as a combined package with Customer relationship management and Business intelligence packages.

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Ongoing trends in ERP:

1. ERP Systems integrated with social media:

With the growing popularity of social media platforms, business organizations like to integrate their ERP systems with such social media. The efficacy of these systems is yet to be established.

2. Cloud ERP systems

Many business organizations are now moving towards storing their Data on cloud, as opposed to the earlier trends when they were reluctant about storing data online. The many advantages of cloud, one of which is easy accessibility are responsible for its growing popularity amongst people.

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3. Cell phone ERP systems

Cell phones have almost become a lifeline these days. Easy access to data from anytime and anywhere is a big advantage. So, ERP makers had to develop systems accessible from mobile devices. Business executives can now access an manage reports, dashboards and other data from their mobile devices.

4. Two tier ERP Systems
Use of a single ERP system to store all the data at all the levels leads to technical difficulties and failures at times. So, two tier ERP systems were introduced. These systems were introduced with the concept that the back end functions can be carried out at some subsidary site apart from the head corporate office.

Two tier ERP software systems are used by companies that are based in multiple geographical locations. Under two tier system, one Legacy application runs at the corporate level. It usually consists of a company's chief / key data bases. All the other software used in the company must be compatible with the legacy application or should be able to import data from the legacy application. The two tier system allows the benefit of installing and using a second ERP system at some other site which is completely integrated with legacy system. This second system can be modified as per the language and regional business model demands to cater to the specific needs at subsidiary level.

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    • jayshreebhagat profile image
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      Jayshree Bhagat 2 years ago from MUMBAI

      thank you for the lovely comment

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