Enterprise Resource Planning (ERP) systems attempt to
integrate several data sources and processes of an
organization into a unified system. A typical ERP system
will use multiple components of computer software and
hardware to achieve the integration.
A key ingredient of most ERP systems is the use of a
unified database to store data for the various system
modules.
The initials ERP originated as an extension of MRP (material
requirements planning then manufacturing resource
planning).[2] ERP systems now attempt to cover all basic
functions of an enterprise, regardless of the organization's
business or charter.
Non-manufacturing businesses, non-profit organizations
and governments now all utilize ERP systems.
To be considered an ERP system, a software package must
provide the function of at least two systems. For example, a
software package that provides both payroll and accounting
functions could technically be considered an ERP software
package.
However, the term is typically reserved for larger, more
broadly based applications.
The introduction of an ERP system to replace two or more
independent applications eliminates the need for external
interfaces previously required between systems, and provides
additional benefits that range from standardization and
lower maintenance (one system instead of two or more) to
easier and/or greater reporting capabilities (as all data is
typically kept in one database).
Examples of modules in an ERP which formerly would have been
stand-alone applications include: Manufacturing, Supply
Chain, Financials, Customer Relationship Management (CRM),
Human Resources, Warehouse Management and Decision Support
System.
