Beginner’s Guide to Enterprise Resource Planning, Part 2

November 20, 2012

In the first segment of our ERP beginner’s guide, we defined ERP and discussed the qualities that make up an ERP system. Now, we study specific components found in a system, as well as the most common uses of ERP.

A true ERP system includes several parts that, together, create a functional and accessible platform usable across all divisions of a business. ERP systems are held together by the transactional backbone, which entails pieces that deal with distribution and financials. Additionally, the transactional backbone notes the duration of a product and addresses human resources concerns. An ERP system is not worthwhile if it cannot handle advanced functions such as customer relationship management (CRM) and software that facilitates manufacturing, purchasing, and distribution. Products housed in storage facilities also require warehouse management systems, which are included in ERP setups. Finally, management personnel require special access to ERP platforms; a decision-support system with access to all aspects of ERP is integrated for that purpose.

Where are ERP systems considered applicable? In this day and age of technology-driven business, practically everywhere. Human resource departments rely on ERP systems to help with concerns such as training, attendance, timesheets, benefits packages, and payroll. The supply chain management industry requires ERP setups for matters spanning inventory, order tracking and entries, product inspection, commission calculation, and more. There is no end to the value of ERP.

While ERP systems are made to be accessible to all users, designing the system itself and ensuring that it includes all the components vital to a business’ survival is complicated. Because of this, most companies contract outside businesses well versed in ERP design and implementation. The three most common services companies require of ERP contractors are support, customization, and consultation. On average, ERP projects take more than 12 months to complete and require the skill of 150 ERP consultants or more.

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