WebRTC Expert Feature

May 21, 2019

4 Things You Should Know About ERPs

Enterprise resource planning (ERP) software helps companies manage their businesses efficiently. It standardizes, integrates, and streamlines disparate business processes in a variety of departments, making managing people, buying products, and selling items or services easier. ERPs are becoming more and more popular and profitable for large corporations and small businesses. Here are some things you should know about this rapidly improving technology.

1. The History of ERP

The term enterprise resource planning has a long history. It was created in the 1990s to describe the evolution of materials requirements planning (MRP) and manufacturing resource planning (MRP II). However, software engineers started building programs to monitor inventory in the 1960s. These technologies quickly expanded beyond inventory or manufacturing into finance, human resources, and many other departments. ERP gave businesses the resources they needed to adapt to Y2K and the formation of the European Union and the Euro. It was also a cost-effective way to replace old or archaic systems.

Today, ERP encompasses business intelligence as well as front-office functions such as sales force automation (SFA), marketing automation, and e-commerce. Companies in a range of industries use ERP, from wholesale distribution to e-commerce.

2. Types of ERPs

ERP systems are usually categorized in tiers. Tier I ERPs support large, international corporations. They can handle issues and tasks such as currency conversion, translations, and different accounting and tax rules between countries. Tier II ERPs support large companies that operate in several countries, but not all over the world. They can be standalone entities or parts of larger enterprises. Mid-sized businesses use Tier III ERPs. They can support a few different languages and currencies, but they usually have just a single alphabet. Tier IV ERPs are designed for small companies, and they often focus on accounting.

Tier I Government ERPs mostly support federal agencies, and Tier II Government systems are for local and state authorities. You should look for a flexible ERP that helps you save time and make decisions.  

3. The Differences Between CRM and ERP

Customer relationship management (CRM) is the set of systems and processes used for managing a company's interactions with potential and current customers. CRM software is used to organize and automate sales, marketing, and customer service. It can help you keep existing customers loyal, identify people interested in your product, and close deals. ERP manages business processes by cutting costs and reducing overhead while CRM increases sales volume. Both systems can work together to increase profitability, so you won't have to worry about choosing CRM vs. ERP. 

4. ERP Provides Data for Quick Choices

All of your business's departments can integrate and share information with ERP. ERP can coordinate order taking, inventory, manufacturing, accounting, and distribution to prevent errors and help your business adapt quickly to changes. It helps your company reduce costs and stay organized by keeping track of expenses taking care of HR functions such as vacation requests, scheduling, and training.

ERPs are becoming more and more popular for small and large businesses across a multitude of industries including manufacturing, distribution, professional services, construction, and more. You can reduce your company's costs and keep your technology up to date by using an ERP.

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