"ERP" - Defining Enterprise Resource Planning

The Best Enterprise Resource Planning (ERP) system integrates both internal and external business information flows used by the organization within a single, comprehensive solution. An ERP solution incorporates the practical systems used by organizations to manage the basic commercial functional requirement of their business, such as: procurement, planning, inventory/materials management, purchasing, manufacturing, finance, accounting, human resources, marketing and sales, services etc. The objective of the ERP solution is to drive the flow of information between all internal business functions while managing connections, or "touch points," to outside stakeholders.

ERP solutions runs on a variety of interlinked computer hardware and network configurations, including "on premises" (i.e. client/server) or hosted (i.e. "cloud-based" or Software as a Service).

Regarding details related to configuration, typically ERP solutions uses a global database to gather and maintain information(as a data) from the various business functions which is accessible in some or another form by various users around the globe. The use of an integrated database to manage the solution's multi-module application framework within a common information system is one of the primary ERP benefits of this kind of system over "point solutions."

Unlike point solutions (historically used by small to midsize businesses) that rely on multiple (sometimes duplicating) databases which strain IT resources, ERP solutions standardize the use of one application to run an entire business. This not only increases efficiency, but also decreases the overall total cost of ownership (TCO), thereby reducing operational costs and improving the company's profitability.

"ERP Process Flow Diagram"