ERP (Enterprise Resource Planning) is first and foremost an integration of business management practices and modern technology provided by www.syntax.com. Information technology (IT) integrates the most important business processes in an organization to modernize and achieve defined business goals. Accordingly, ERP is the unification of three major components: business management practices, information technology and specific business goals.
In other words, ERP is a massive software architecture that supports routing data flow and distributing geographically scattered business data to all functional units of a business. It provides the executive management of the enterprise with a comprehensive overview of the implementation of all business activities, which in a productive way can influence their further decisions. At the heart of the ERP is a well-organized, centralized data warehouse that collects information from and supplies incomplete applications that run on a universal computer platform.
Information in large business organizations is collected on different servers across many functional units that sometimes divide geographical boundaries. Such “islands” of data are likely to serve individual organizational units, but they fail to enhance enterprise-wide business performance, speed and expertise.
How ERP is interpreted
The term ERP originally referred to the way large organizations planned to use their resources. Previously, ERP systems were used in large and more industrial companies. However, the use of ERP systems has changed radically over a period of several years. Today, this term can be applied to any type of company business in any field regardless of the size and significance of that business.
In today’s sense, the software architecture of an ERP system can almost completely cover a wide range of enterprise functions and integrate them into a single data warehouse. For example, functions such as human resources function, supply chain management, customer relationship management, finance, production and inventory management, and logistics were previously solitary software applications, mainly supplied with their own applications, database and network. Today, all these sectors can work together “under the same umbrella” – the ERP system.
For a software system to be considered an ERP, it must provide the enterprise with many functionalities with features such as flexibility, modularity & clarity, breadth, finest business processes and global focus.
Integration is an extremely important component of an ERP system. Integration of business processes helps the development of communication and the distribution of information, resulting in extraordinary increases in productivity, speed and business performance.
The main goal of an ERP system is to integrate information and processes from all business affiliates of an organization and integrate them so that they can be easily accessed and create a structured workflow. Typically, integration is achieved by constructing a single warehouse or database that communicates with multiple software applications, providing diverse sectors of an organization with diverse business statistics and information.
Although the perfect configuration would be a single ERP system for the entire organization, many larger business organizations typically develop a single functional system and slowly interface with other business sectors. This type of system development can be time consuming and expensive.
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