What’s ERP And Why Is It Need For Running Businesses?

ERP is the short for enterprise resource planning. From the name you could already conclude that this is some software meant to help large enterprises in planning their resources. However, with the popularity of ERPs systems and softwares, the small and medium sized businesses felt that the need of using it too. It is most accurate to say that even the mid-sized businesses benefit from ERP system as much as large enterprises do. What ERP system actually does can only be understood once it starts to put process running in your business in one place but we can still try to describe to our best in words.

ERP system is an integration of many different types of applications in one place allowing people from different departments in the company to store, manage, modify and use this information from one point. The important thing to understand here is that the ERP system is implemented across all departments within a company. It is therefore considered more suitable for large businesses because they have more organized departments and also the resources to implement the ERP system. Another important piece of information here is that ERP system consists of many different applications.

Of course, when you have various departments in the company you will have to manage them differently. Sales department will operate differently from marketing department and accounts department will have a completely different role than those sitting in operations. You might require many different types of applications for each department to meet its requirements. However, ERP gets all of these applications in one place and your entire company relies solely on one particular software – the ERP software. The data, traits and settings of all those applications are integrated into the ERP system and so each department continues to work as it was working.

ERP systems allow business owners to keep track of what’s going on in their companies. From sales and procurement to accounting and human resources, they have a clear picture of every process right in front of them on their computers screens. Every piece of information that a customer support representative obtains from the customers and stores on the CRM goes on the ERP software along with every change in information made by accounts and human resource department in the database of employees. How much inventory you have, what’s going out of the stock and how many purchase orders are pending, all of this can be viewed on your ERP system.

In short, ERP system puts a clear and concise picture of the entire business in front of the business owner. The information presented to him is not in the form of random reports rather in a format that allows him to take decisions for the business. In short, the reports produced and data analyses given by the ERP system to the business owner allow him to do future planning for the business. Some of the biggest benefits of ERP system implementation include time-saving and error free processing of information in the database.