Track and analyze key information, improve productivity and drive smarter decisions.
The need for cutting edge ERP solutions is becoming crucial in this information age. This is accentuated by the fact that even the most fundamental market philosophies are changing rapidly and radically. Market for almost all products / services has become truly global.
Enterprise Resource Planning as a term, derives from material resource planning. Enterprise resource planning systems (ERP) are management information systems that integrate and automate many of the business practices associated with the operations or production aspects of a company. These typically include manufacturing, logistics, distribution, inventory, shipping, invoicing, and accounting. Enterprise Resource Planning or ERP software can aid in the control of many business activities, like sales, delivery, billing, production, inventory management, and Human Resource Management Systems.
They are often called back office systems indicating that customers and the general public are not directly involved. This is contrasted with front office systems like customer relationship management systems that deal directly with the customer.
ERPs are cross-functional and enterprise wide. All functional departments that are involved in operations or production are integrated in one system. In addition to manufacturing, warehousing, and shipping, this would include accounting, human resources, marketing, and strategic management.
Thus some ERP software caters to a wide range of industries from service sectors like software vendors and hospitals to manufacturing industries and even to government departments.
| Advantages |
The benefits from enterprise resource planning are claimed to include: |
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lower inventory carrying costs |
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lower ordering costs |
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lower production costs |
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lower accounting and record keeping costs |
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lower transportation costs |
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lower investment in equipment |
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lower investment in plant |
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lower investment in land |
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reduced assembly-line down-times |
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more flexible production processes |
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more efficient lot sizes and scheduling |
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reduced errors due to better coordination |
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the cost and efficiency improvements (mentioned above) could increase profitability or increase market share (at a lower price) |
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reduced number of stock-outs |
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reduced fulfillment times |
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increase process transparency for the customer |
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allow greater product customization, and thereby better match the exact needs of the customer |
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the customer satisfaction improvements (mentioned above) could increase sales volume, increase sales revenue (due to a higher effective price , ie. - no discounts), increase market share, and increase profitability |
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