When we think of Enterprise Resource Planning (ERP), what pops into your mind? Is it a software that helps to increase efficiency and productivity in the workplace or does it help to automate processes for certain departments?
Well, Enterprise Resource Planning is a type of software that companies use to help manage their day-to-day business affairs like project management, accounting, supply chain operations, etc.
In this article, we would be touching briefly on the history of enterprise resource planning, how it affects your business and the benefits of using it.
The term ERP was first used by the Gartner Group during the 1990s. However, the system itself has its roots deep in the manufacturing industry and its history can be traced all the way back to the 1960s!
A basic software solution called Material Requirements Planning (MRP) systems were developed as there was a need for a better way for manufacturers to manage, track and control their inventory. Some functions of the system include monitoring inventory, delivery functions, purchasing, etc.
Through the 1970s, more companies made use of MRP systems and more sophisticated versions were created. By the 1980s, the system had evolved into something called Manufacturing Resource Planning systems.
In the 1990s, the first ERP system was used. It expanded further beyond basic inventory control to include other departments and functions like accounting, finance, sales, etc.
Using an ERP helps your business have better insight and visibility on its supply chain operations, thus helping you make key decisions and stay ahead of your competitors. Using the system also helps to improve productivity and efficiency in the workplace as it automates certain tasks and removes redundant steps, thus also helping to reduce costs!
Here are some benefits your company would receive if it uses an ERP system: