The comprehensive definition of enterprise resource planning (ERP) software is a set of applications that automate finance and human resources departments and help manufacturers handle jobs such as order processing and production scheduling.
ERP began as a term used to describe a sophisticated and integrated software system used for manufacturing. In its simplest sense, ERP systems create interactive environments designed to help companies manage and analyze the business processes associated with manufacturing goods, such as inventory control, order taking, accounting, and much more. Although this basic definition still holds true for ERP systems, today its definition is expanding.
Savvy ERP users, increasing customer expectations, changes in manufacturing requirements, and technology's relentless pursuit of innovation are just some of the forces reshaping the definition of ERP. In today's dynamic and turbulent business environment, there is a strong need for organizations to become globally competitive. The survival guide to competitiveness is to be closer to the customer and deliver value-added product and services in the shortest possible time. This, in turn, demands integration of the business processes of an enterprise, which is the stronghold of ERP.
Today's leading ERP systems group all traditional company management functions (finance, sales, manufacturing, human resources) and include, with varying degrees of acceptance and skill, many solutions that were formerly considered peripheral (product data management (PDM), warehouse management, manufacturing execution system (MES), reporting, etc.). While during the last two years the functional perimeter of ERP systems began an expansion into its adjacent markets, such as supply chain management (SCM), customer relationship management (CRM), business intelligence/data warehousing, and e-Business, the scope of this document is limited to the traditional ERP realms of finance, materials planning, and human resources.
The Three Major Functional areas of ERP are as follows:
* Manufacturing & Logistics
* Finance & Accounting
* Human Resources & Payroll.
This encompasses a group of applications for planning production, taking orders, and delivering products to the customer. Some of its most common modules and their high-level functions are:
Operations (Production) planning - Performs capacity planning and creates a daily production schedule for a company's manufacturing plants. It involves forecasting, production scheduling and material planning, etc.
Engineering - Provides the ability to integrate at the engineering level to ensure accurate updated product information. It involves bills of materials & routings creation, engineering change management, etc.
Shop floor control - Provides control and tracking of the status of production orders in the plant. It involves production orders dispatching, capacity planning, resource allocation, production tracking & reporting, waste/reject tracking, etc.
Procurement management - Controls purchasing of raw materials needed to build products. Manages inventory stocks. It involves creating purchase orders/contracts, supplier tracking, goods receipt & payment, etc.
Order entry and processing - Automates the data entry process of customer orders and keeps track of the status of orders. It involves order entry, order tracing and status reporting, pricing, invoicing, etc.
Sales, marketing, and after sales - Provides a basic functionality for lead tracking, customer information, quote processing, commissions & rebates, etc.
Warehouse (Inventory) management - Maintains records of warehoused goods and processes movement of products through warehouses.
Distribution (Transportation) management - Arranges, schedules, and monitors delivery of products to customers via trucks, trains, and other transport means. It involves transportation planning and execution, loading and shipping documentation, etc.
Project management - Monitors costs and work schedules on a project-by-project basis. It usually includes the following sub-modules: project control, project analyzer, project budgeting, project timekeeping, project billings, contract management, and workflow communicator.
Plant maintenance - Sets plans and oversees upkeep of internal facilities. It enables the control of every aspect of both routine and unscheduled equipment maintenance so as to provide uninterrupted work order process.
Customer service management - Administers installed-base service agreements and checks contracts and warranties when customers call for help.
ERP began as a term used to describe a sophisticated and integrated software system used for manufacturing. In its simplest sense, ERP systems create interactive environments designed to help companies manage and analyze the business processes associated with manufacturing goods, such as inventory control, order taking, accounting, and much more. Although this basic definition still holds true for ERP systems, today its definition is expanding.
Savvy ERP users, increasing customer expectations, changes in manufacturing requirements, and technology's relentless pursuit of innovation are just some of the forces reshaping the definition of ERP. In today's dynamic and turbulent business environment, there is a strong need for organizations to become globally competitive. The survival guide to competitiveness is to be closer to the customer and deliver value-added product and services in the shortest possible time. This, in turn, demands integration of the business processes of an enterprise, which is the stronghold of ERP.
Today's leading ERP systems group all traditional company management functions (finance, sales, manufacturing, human resources) and include, with varying degrees of acceptance and skill, many solutions that were formerly considered peripheral (product data management (PDM), warehouse management, manufacturing execution system (MES), reporting, etc.). While during the last two years the functional perimeter of ERP systems began an expansion into its adjacent markets, such as supply chain management (SCM), customer relationship management (CRM), business intelligence/data warehousing, and e-Business, the scope of this document is limited to the traditional ERP realms of finance, materials planning, and human resources.
The Three Major Functional areas of ERP are as follows:
* Manufacturing & Logistics
* Finance & Accounting
* Human Resources & Payroll.
This encompasses a group of applications for planning production, taking orders, and delivering products to the customer. Some of its most common modules and their high-level functions are:
Operations (Production) planning - Performs capacity planning and creates a daily production schedule for a company's manufacturing plants. It involves forecasting, production scheduling and material planning, etc.
Engineering - Provides the ability to integrate at the engineering level to ensure accurate updated product information. It involves bills of materials & routings creation, engineering change management, etc.
Shop floor control - Provides control and tracking of the status of production orders in the plant. It involves production orders dispatching, capacity planning, resource allocation, production tracking & reporting, waste/reject tracking, etc.
Procurement management - Controls purchasing of raw materials needed to build products. Manages inventory stocks. It involves creating purchase orders/contracts, supplier tracking, goods receipt & payment, etc.
Order entry and processing - Automates the data entry process of customer orders and keeps track of the status of orders. It involves order entry, order tracing and status reporting, pricing, invoicing, etc.
Sales, marketing, and after sales - Provides a basic functionality for lead tracking, customer information, quote processing, commissions & rebates, etc.
Warehouse (Inventory) management - Maintains records of warehoused goods and processes movement of products through warehouses.
Distribution (Transportation) management - Arranges, schedules, and monitors delivery of products to customers via trucks, trains, and other transport means. It involves transportation planning and execution, loading and shipping documentation, etc.
Project management - Monitors costs and work schedules on a project-by-project basis. It usually includes the following sub-modules: project control, project analyzer, project budgeting, project timekeeping, project billings, contract management, and workflow communicator.
Plant maintenance - Sets plans and oversees upkeep of internal facilities. It enables the control of every aspect of both routine and unscheduled equipment maintenance so as to provide uninterrupted work order process.
Customer service management - Administers installed-base service agreements and checks contracts and warranties when customers call for help.
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