what is ERP ?

This may be overly simple for some, but I figured we should start at the top.  If this topic is too light for your taste, feel free to browse some of the other material on the site, or subscribe to be informed when newer articles are posted.

Enterprise Resource Planning (ERP) can be separated into the action and the software supporting the action.  Here, we will focus mainly on the software, understanding that the software exists and must be configured to help a business perform the action.

ERP Software helps an enterprise plan their resources.  Pretty simple, right?  Questions that always arise next are:

How big an enterprise?

What resources?

What about historical data?

The answer is still as simple – ERP suites can do everything for everyone!  Each of the questions above has an answer (with obvious conditions) that would allow any enterprise to plan and track any resource.

How big an enterprise?  The benefit to most ERP suites is that a single piece of software (or several pieces of tightly integrated software) can provide an enterprise with a live view of their resources and activities.  Although some ERP suites, such as SAP and Oracle, are beyond the financial means for most small companies, there are other options out there.  Open source initiatives, such as Odoo or OpenBravo can help those that have the technical expertise to install and manage their own system.  Software companies that normally help smaller businesses, such as SAGE and Intuit also have bigger systems that are supporting small business as the business grows with tools like SAGE 300 and QuickBooks Enterprise.  This means there’s a suite of software out there for every size of enterprise.

What resources?  The quick answer here is all resources, or at least any resources in which you are interested.  Most ERP suites are modular, and you can pick and choose which modules you wish to install and use.  This helps an enterprise track and plan for not only the obvious resources such as cash (Financials) and people (Human Resources), but also Inventory, Production Scheduling, Service Delivery, Real Estate, among many others.  ERP suites can also reach out to your suppliers and customers via automated interfaces, and provide real time views of data outside your organization, as well.

What about historical data?  The word Planning doesn’t mean that ERP suites are only future oriented.  Most have grown out of systems that track and enable reporting of actual transactions.  Many also include Business Warehouse / Business Intelligence (“Big Data”) capabilities from which you can perform data mining to detect historical trends and extrapolate to predict future movements.

So effectively, an ERP suite is for any enterprise, and can help track and plan for any resource based on actual transactions.  Which one is the best?  I’m glad you asked…   🡨 link to article #2 …