Erp - Importance

Erp - Importance

ERP is the acronym of Enterprise Resource Planning. Enterprise Resource Planning (ERP) is an enterprise-wide information system that integrates and controls all the business processes in the entire organization (Nah and Lau 2001). ERP utilizes software applications to improve the performance of organizations' resource planning, management control and operational control. ERP software is multi-module application software that integrates activities across functional departments, from product planning, parts purchasing, inventory control, product distribution, to order tracking. ERP software may include application modules for the finance, accounting and human resources aspects of a business.
“ERP system is a business management system that comprises integrated sets of comprehensive software, which can be used, when successfully implemented, to manage and integrate all the business functions within an organization. These sets usually include a set of mature business applications and tools for financial and cost accounting, sales and distribution, materials management, human resource, production planning and computer integrated manufacturing, supply chain, and customer information” (Boykin, 2001; Chen, 2001).
“These packages have the ability to facilitate the flow of information between all supply chain processes (internal and external) in an organization” (Al-Mashari and Zairi, 2000).
Furthermore, an ERP system can be used as a tool to help improve the performance level of a supply chain network by helping to reduce cycle times (Gardiner et al., 2002).

ERP packages touch many aspects of a company’s internal and external operations. Consequently, successful deployment and use of ERP systems are critical to organizational performance and survival. Potential benefits include drastic declines in inventory, breakthrough reductions in working capital, abundant information about customer wants and needs, along with the ability to view and manage the extended...

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