Modern technologies

What is an ERP system?

1. What is an ERP system? What companies can it help?
2. The history of ERP is long
3. From MRP to ERP – the blossoming of the software field
4. What is an ERP system? What are the benefits of ERP implementation in our company?

What is an ERP system? What companies can it help?

Let’s start by explaining what is an ERP system? First of all, it is software thanks to which we can integrate all the processes and resources of our company. ERP systems are constantly evolving and being improved, all in order to improve our work. ERP is an abbreviation of the English phrase Enterprise Resources Planning, which we translate as “resource planning” of the enterprise. With the development of new technologies, it is irreplaceable. Thanks to it, we are able to supervise almost all areas of our company. Such as:
• sale,
• finance,
• accounting,
• staff,
• supplies,
• production,
• warehouse.
Something that determines such a high efficiency of the discussed system is the ability to operate on one database. How does it look in practice? For example, if we enter data into the commercial area, then employees related to other departments, e.g. production, accounting or warehousing, will also see them. Everything depends on the profession of our company.

The history of ERP is long

Few of the active users of the discussed software are aware of the fact that their cradle is the post-war MRP system. It is an abbreviation of the English phrase Material Requirements. We translate it as “material requirements planning”. The first of these systems was developed by programmers as early as 1964. An interesting fact is that it was first implemented by entrepreneurs at Black and Decker. It is a thriving American manufacturer of power tools. It was thanks to the fact that its board was not afraid of technological innovations that the company could prosper so well. Other entrepreneurs followed suit as well.
In 1980, as a result of increased computerization of processes, about 8,000,000 people opted for the product. companies around the world. Thanks to MPR software, their users have facilitated a lot of tedious work and had reliable access to key information of their company. For example, they could determine the demand for semi-finished products (the so-called Bill of Materials, or BOM) and other potential supplies. Let’s pause for a moment to explain this English phrase. The BOM is a document thanks to which we determine the need for elements that will make the production process run smoothly. All elements necessary to perform a given production process. The MPR made it possible to provide such information as, for example, the current state of stocks. Let’s remember that MPR was just the beginning of ERP programs and they covered only a small area of ​​the market. On the other hand, we use the ERP system in every area of ​​business.

From MRP to ERP - the blossoming of the software field

The apogee of MPR software development falls on the 1990s. Why? In these years, the first computers with high computing power appeared. This meant that we were now able to coordinate a large amount of information, and this paved the way for us to be in charge of all elements of the enterprises. We were then able to gradually integrate all the necessary activities. The progress in the field of management has also come as a result of the spread of the Internet. It was then that cloud technologies and applications developed, thanks to which we as employees have access to the main data work. Currently, advanced ERP software is coupled with specialized modules and applications (i.e. services). In this way, we integrate our work and support the company’s areas for which we are responsible.

What is an ERP system? What are the benefits of ERP implementation in our company?

If we talk about the benefits of implementing ERP software in our company, most of them relate to savings on many levels. So let’s replace them:
• reduction of labor costs – thanks to the automation of many processes, we can reduce the number of employees for whom we incur monthly costs;
• acceleration of decision-making – in this field we save time needed to make specific decisions. Why? The main reason for this is the use of BI (business intelligence) modules by the team of employees. Thanks to this, potential decision-makers can fully learn about the state of the enterprise. Statements, reports or diagrams are prepared on an ongoing basis, which we can interpret on an ongoing basis;

• time saving – thanks to the implementation of ERP, we prepare reports and record documents much faster. Efficiency is also improved in the picking and packing area;
• avoiding tedious searches for information – in this area we can efficiently extract the most important information regarding orders and potential sales. In addition, we quickly find out about the status of contracts with customers. All thanks to the integration possibilities offered by various applications;
• economy and wisdom in the management of warehouses – thanks to ERP, we are able to use warehouse space much more prudently. The program helps us organize our activities and minimize thoughtless and inefficient movements;
• improvement of quality control – this is done, for example, at the level of customer service. Thanks to the possibilities of efficient data organization, which ERP gives us, we can conduct effective business talks. ERP helps us to improve the analysis and interpretation of statistics for specific batches of goods;
• ERP allows us to increase the efficiency of our employees’ work. This is due to the fact that we can easily prepare and check employee cards and measure their performance;
• thanks to the implementation of the discussed system, we organize the prevailing chaos in an accessible way. We also eliminate the risk of legal consequences. Why? Because we can easily update legal and accounting amendments. We simply have an up-to-date insight into professional knowledge. In addition, due to digitization, we minimize the preparation of paper documentation. In this way, we limit access to our databases by third parties;
• if we run a production activity, thanks to ERP we reduce the downtime of our production lines.
The implementation of the ERP system solves the problems of various types of enterprises. You can read about their implementation and ways of using them in the following articles. Welcome 😊

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