The meaning of ERP is much more than the acronym Enterprise Resource Planning.
Traditionally, businesses relied on people to manage ad hoc processes based on experience. It was effective, but slow and costly compared to the data-driven processes of today.
In the postmodern age, well-defined business processes managed using digital devices provide transparent trustable information through formal and social relationships, resulting in increased quality at lower cost.
Enterprise Resource Planning (ERP) software integrates core business processes, and may include support the following:
- Project management
- Engineering Product Lifecycle Management (PLM)
- Production planning
- Manufacturing or the delivery of services
- Marketing, sales and Customer Relationship Management (CRM)
- Materials and inventory management
- Shipping and payment
- Financial reporting
In summary, an ERP system provides a common point for the various functions and departments of an organization to access, share and manage business information.