What is ERP?

What is Entreprise Resource Plannig (ERP)?


ERP Systems are computer programs used by a large amount of companies in order to organize and to manage their processes and resources more efficiently. Under these resources we understand for example; people, stocks and even money. As these resources are the main determinants of the success and development of a company, they have to be well organized.
Important processes within a company are supported by several smaller ERP modules that are included in an ERP system. These modules all support specific tasks within the company.
Companies have a whole bunch of different business processes that need to be supported; we could divide them into basic modules and into more specialized modules.
Basic modules can be for example: customer relationship management, supply chain management, projects, financials, accounting etc
Under the more specialized business modules we find the processes that are related specifically to a certain company or its department. For example the making and managing of order notes.


An ERP system is based on a common database; this allows every department of a company to store and retrieve information in real-time. Moreover, the modular software design allows the company to select the modules they need, mix and match modules form different ERP vendors, and add new modules of their own to improve business performance.
The advantages of ERP are numerous; the main advantage is that all the information systems are incorporated into one central database which makes managing a lot easier. For example when you change something, the different processes will adapt to this change which saves you a lot of work and consequently also money.


ERP Systems are generally sold in basic packages, but if an organization wishes a specific package made for their processes that’s possible. In general this isn’t often done because of the extremely high prices of these packages.
Big organizations may of course prefer this second possibility because of their big and complex structure. In such organizations ERP is of great importance. Lately, more and more Small- and Medium-sized Businesses (SMB’s) have discovered the advantages of ERP systems. As time plays an increasingly important role in our current society, organizations need systems that help support their processes. Taking care that suppliers deliver on time, keeping clients satisfied and limiting stocks are just a few of the activities that need to be managed efficiently and within time.
The providers of ERP systems are big software companies like German software house “SAP”, Dutch giant: “Baan”, Oracle and JD Edwards.