ERP Simplified: Understanding the Basics of ERP and SAP ERP

        ERP stands for Enterprise Resource planning. Erp term is used for software that control the whole organization different departments. use of this package makes it possible to track and manage in realtime sales production finance accounting and human resources. ERP is software which helps business organization to standardize different business processes by integrating them together. 

Enterprise - Big Company.

Resource - Money Men  Machine Material Marketing. 

Planning  - Well utilization of resources.

        A typical enterprise has many department or business unit. these department continuously communicate and exchange data with each other. the success of any organization lie's in effective communication and data exchange within the department as well associated thrid party such as vendor outsources and the customers.

Some Non ERP :

•  VB/JAVA – Front end 
•  ORACLE – Back end

Some ERP Products :

• SAP
• BAAN 
• RAMCO 
• PEOPLE SOFT 
• ORACLE APPS 

Before ERP :

        Before ERP there is a separate database for each department, this phase required more time to achieve customer goals or requirements. Systems developed their own independent values for specific requirements.

After ERP :

         After ERP there is only one database to manage the all departments. So ERP is more efficient to use and manage the time.All system are integrate. the value of integrate solution system greater than value of all individuals solution.

Objective Of ERP :  Drive the flow of information between all internal business function while managing connection or touch points , to outside stakeholders.

MAIN VENDORS OF ERP :

• SAP.
• Baan.
• RAMCO.
• PeopleSoft.
• JD edwards.
• Oracle.

 SAP ERP -  It provides predefined tables.  It provides predefined application programs.  No need to creating & maintaining tables.

BAAN - Nearly 90% of database tables & source code are related to customers & vendors, so it is suitable for small size & mid size companies. E.g.: Vijaya Electronics.

 RAMCO - Nearly 80% of database tables & source code are related to the finance. Hence it is suitable for financial companies. So, it is also suitable for small size and mid size companies. E.g.: Any automobile company. 

People soft - This is good for HR department but weak in relationship with other departments (like Production, Purchasing, Warehouse, FI/CO, Shipping, Sales and Distribution). 

JD edwards - it's designed for all type of businesses - Overall JDE has more than 80 application modules. main  modules are in the following areas: assets, sales, financials, human capital, manufacturing, procurement, order management, project management, and supply chain.

Oracle - Oracle erp system is good for finance module.

          Erp is business management software which used to integrate all the business activities in any organization.all the business has various departments. and  these department exchange and share lot of information with each other. this process take so much of time. to easier this erp is intoduce.

Major reasons for adopting erp

• Integrate financial information.
• Integrate customer order information.
• Standardize and speed up operations processes.
• Reduce Inventory.
• Standardize human Resource information.

Benifits of Erp

Internal Benefits

• Integration of a single souce of data.
• Effective planning.
• Effective use of resources.
• Control over various business procesess.
• Eliminate duplication of data.
• Improve Integration.
• Flexible System.
• Improved speed and efficiency.
• Complete access to information is possible.
• Low cost for complete supply chain.
• Increase productivity, inventory management, promote quality.
• Reduce operating costs and improved internal communication.
• Reduce material cost by inventory planning.

External Benefits

• Improved customer service and order fulfillment.
• Improved communication with suppliers and customer.
• Improve customer service
• Better customer satisfaction.

Functional Areas in ERP:

• Human Resources.
• Research and Dev.
• Marketing and Sales.
• Production.
• Financial and Accounts. 

Evolution of  ERP :

1960  -  Inventory Management And Control.

1970  -  Material Requirement Planning.

1980  -  Manufacturing Requirement Planning.

1990  -  Enterprise Resource Planning.