What is ERP?


Roberto Scaramuzza - Linkedin profile

Roberto Scaramuzza - Linkedin profile

ERP stands for “enterprise resource planning”.  The definition of enterprise resource planning is an integrated software solution used to manage a company’s resources.  ERP systems integrate all business management functions, including planning, inventory/materials management, engineering, order processing, manufacturing, purchasing, accounting and finance, human resources, and more.

Why implement an ERP system?

ERP software integrates all departments and functions across a company onto a single computer system that can serve all those different departments’ particular needs.  ERP combines finance, HR, manufacturing and distribution all together into a single, integrated software program that runs off a single database so that the various departments can more easily share information and communicate with each other.  This integrated approach can have a tremendous payback provided the software is installed and used correctly.

What are the benefits of an ERP System?

The benefits derived from ERP can far outweigh the costs of the system, providing that the system is selected carefully and is appropriate for your company from a feature, cost, and technology standpoint.  Some of the benefits realized are:

  • A single integrated system
  • Streamlining processes and workflows
  • Reduce redundant data entry and processes
  • Establish uniform processes that are based on recognized best business practices
  • Information sharing across departments
  • Improved access to information
  • Improved workflow and efficiency
  • Improved customer satisfaction based on improved on-time delivery, increased quality, shortened delivery times
  • Reduced inventory costs resulting from better planning, tracking and forecasting of requirements
  • Turn collections faster based on better visibility into accounts and fewer billing and/or delivery errors
  • Decrease in vendor pricing by taking better advantage of quantity breaks and tracking vendor performance
  • Track actual costs of activities and perform activity based costing
  • Provide a consolidated picture of sales, inventory and receivables

An ERP system provides the solid operational backbone manufacturers and distributors need to improve the volume of production and fulfillment of orders while reducing costs.  By optimizing your manufacturing and distribution operations with ERP, you’ll also be able to focus on new business opportunities.

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