Definition:

Enterprise Resource Planning (ERP) is an integrated suite of software applications designed to manage an organization’s core processes — including finance, supply chain, procurement, human resources, sales, and operations — from a single, centralized platform.

The current ERPs are modular, cloud-based, meaning that a business can customize functionality to its requirements and can expand with the business. ERPs assist in getting rid of disintegrated systems, minimize data entry, and provide real-time view of the performance.

Why It’s vital to Businesses:

• Centralization of Data: All the departments have access to common up-to-date information.
• Process Automation: Minimizes manual procurement, accounting and HR work.
• Compliance & Auditing: Simplifies reporting to regulatory authorities.
• Cost Efficiency: minimizes inventory, waste and predicts demand more accurately.

Popular ERP Platforms:

Odoo, SAP, Zoho ERP, Oracle NetSuite, Microsoft Dynamics 365

Example Scenario:

An example of how ERP can be used is by a manufacturer who wants to keep track of inventory, automatic creation of purchase orders when inventory is running low, creation of shifts with employees and generation of financial reports to be viewed at the end of the quarter.