What is ERP ?

What is ERP?

 The full form of ERP is Enterprise Resource Planning, that is, in a large size business, how to use the resources in a planned manner, this can be made possible through ERP.

 Through ERP, all the business processes like Finance, HR, Planning, Manufacturing, Maintenance, Supply and Accounts etc. are integrated into one system, and all the departments work on the same software.

 In this software, modules are made according to the department, if there is an account department, then there will be a module related to the account and similarly for HR, Manufacturing etc., their separate modules are made.

ERP uses shared database, that is, all the modules work on one database.  The user enters information about his work on the dashboard of the ERP software from his computer, and that information becomes available to everyone in real time, due to which the work remains visible to everyone and also speeds up the work.

 Some of the most commonly used ERP software are as follows (Oracle ERP Suite, SAP ERP, Microsoft Dynamics, Infor Syteline) etc.

 Along with this, many companies also develop their personal ERP solution according to their business.  So you can understand that by implementing ERP, transparency can be brought in the business, and the business can be managed properly.

Types of ERP :

 There are three types of ERP Cloud, Premise and Hybrid, let us understand these three types.

 Cloud ERP System:- In this, the ERP Data Center is hosted on Cloud Computing Platforms available on the Internet instead of being located in the company premises.  For which monthly or yearly rent has to be paid, and being on the cloud, it can be used on the internet anytime and from anywhere.

 Using Cloud ERP is less expensive than using an ERP Server installed at the company premises, meaning software maintenance costs are saved, and expenses on ERP software licenses can also be avoided.

 On Premise ERP System:- In this, the ERP Data Center is installed in the company’s own premises, that is, it is completely under the control of the company’s IT team and being in the company’s premises, it does not have to depend on any hosting company.  This increases data security and can also be upgraded to hybrid cloud if needed in future.

 Hybrid ERP System:- Hybrid ERP is a combination of both Cloud and Premise ERP, that is, after setting up this system, ERP can be used on both Premise and Cloud, it is also called Two-Tier ERP Model.  If we talk about the expenses involved, then you can give it a place between Cloud and Premise.

Benefits of using ERP :

  • Business work can be expedited.
  • Changes happening on the data can be seen in real time.
  • Information about business activities is available to everyone.
  • The scope for double entry or wrong information in data is reduced.
  • Time and cost can be reduced significantly.
  • All the modules of ERP use shared database, due to which the scope of duplicate records is negligible.
  • There is complete transparency in business operations.

Disadvantages of using ERP :

  • There is a lot of expenditure involved in its implementation and maintenance, for which the company has to prepare its budget.
  • Its use is complex, requiring selection and training of the right staff so that the entire system can function.
  • The data of the old software being used has to be prepared again on it, which takes a lot of time.
  • Its full use in business takes a lot of time, which can affect the business.

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