Published on Feb 12, 2016
In EMS, the Enterprise Resource Planning (ERP) system plays a very important role. The major decision making and it execution is done through ERP. It's the system of managing all functions of the business with information support coming through the ERP. It handles the operational systems to run business and provides the required inputs to planning and control systems handled by the middle management.
Description of Enterprise Resource Planning ERP
ERP is a way to integrate the data and processes of an organization into one single system. Usually ERP systems will have many components including hardware and software, in order to achieve integration, most ERP systems use a unified database to store data for various functions found throughout the organization. Enterprise Resource Planning (ERP) is a company-wide computer software system used to manage and coordinate all the resources, information, and functions of a business from shared data stores
The evolution of ERP systems closely followed the spectacular developments in the field of computer hardware and software systems. During the 1960s most organizations designed, developed and implemented centralized computing systems, mostly automating their inventory control systems using inventory control packages (IC). These were legacy systems based on programming languages such as COBOL, ALGOL and FORTRAN. Material requirements planning (MRP) systems were developed in the 1970s which involved mainly planning the product or parts requirements according to the master production schedule. Following this route new software systems called manufacturing resources planning (MRP II) were introduced in the 1980s with an emphasis on optimizing manufacturing processes by synchronizing the materials with production requirements.
MRP II included areas such as shop floor and distribution management, project management, finance, human resource and engineering. ERP systems first appeared in the late 1980s and the beginning of the 1990s with the power of enterprise-wide inter-functional coordination and integration. Based on the technological foundations of MRP and MRP II, ERP systems integrate business processes including manufacturing, distribution, accounting, financial, human resource management, project management, inventory management, service and maintenance, and transportation, providing accessibility, visibility and consistency across the enterprise
During the 1990s ERP vendors added more modules and functions as "add-ons" to the core modules giving birth to the "extended ERPs." These ERP extensions include advanced planning and scheduling (APS), e-business solutions such as customer relationship management (CRM) and supply chain management (SCM). Figure 2.1 summarizes the historical events related.