Businesses today confront new markets, new competition, and increasing customer expectations. Thus, companies are constantly having to update their business practices and procedures to be even more responsive to their customers and competition. Within the last decade, information technology emerged as an essential tool to give businesses a competitive advantage. More specifically, ERP (Enterprise resource planning) systems are a major information technology being used, in hopes of obtaining this competitive advantage. The efficiency of an enterprise relies upon how quickly information flows across the complete supply chain i.e. from the manufacturer to the supplier to the consumer and so forth. The main purpose of an ERP system is to expedite the supply chain and to make it more efficient.
ERP is an enterprise wide system that integrates primary business applications, including all areas and levels of an organization. Each application within an ERP suite shares a common set of data that is stored in a central database.
This central database serves as a backbone for the organization, integrating key business and management processes. This allows you to see more accurately and completely what is going on within the company. A typical ERP system includes applications for accounting and controlling, production and materials management, quality management, sales and distribution, project management, and human resources.
Within the past decade, most major companies recognized the significance of information technology and implemented ERP systems. However, many businesses found ERP difficult to implement and use properly and effectively. Many businesses tried to adapt their business process to the ERP system, rather than the other way around. To be done correctly, the process must be done the other way with the system being customized and adapted to your existing business processes. Moreover, ERP systems only address the needs of part of the enterprise, creating islands of...